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Study Resources (Accounting)

11) Which of the following is a liability created when a company receives cash for services to be provided in the future? A) Unearned revenue B) Accrued liability C) Service revenue D) Estimated warranty payable 12) Sales revenue for a sporting goods store amounted to $215,000 for the current period.  All sales are on account.
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21) The following information is from the 2013 records of Armadillo Camera Shop: Accounts receivable, December 31, 2013 $20,000 (debit) Allowance for uncollectible accounts, December 31, 2013 prior to adjustment 600 (debit) Net credit sales for 2013 95,000 Accounts written off as uncollectible during 2013 7,000 Cash sales during 2013 27,000 Uncollectible accounts expense is estimated by the percent-of-sales method.  Management.
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Learning Objective 8-3 1) The direct write-off method conforms to the matching principle better than the allowance method. 2) A company uses the direct write-off method to account for uncollectible receivables.  Uncollectible account expense will be estimated as a percentage of sales. 3) The direct write-off method is used primarily by large.
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Learning Objective 10-1 1) If an installment note payable has installments due within a year, the entire note is treated as a current liability. 2) Amounts owed for products or services purchased on account are contingent liabilities. 3) Unearned revenue is an obligation to provide goods or services to the customer. 4) Notes.
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31) The depreciation method where salvage value is ignored until the end of the life of the asset is: A) straight-line. B) First-In, First-Out. C) double-declining-balance. D) units-of-output. 32) An asset has a life of 3 years.  It cost $90,000 and has an expected salvage value of $15,000.  Using straight-line depreciation, what is the depreciation.
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41) At January 1, Davidson Services has the following balances: During the year, Davidson has $104,000 of credit sales, collections of $100,000, and write-offs of $1,400.  Davidson records Uncollectible account expense at the end of the year using the percent-of-sales method, and applies a rate of 1.1% based on past history. After.
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11) A company reports Net accounts receivable of $107,460 on its December 31, 2013 balance sheet.  The Allowance for uncollectible accounts has a credit balance of $3,200.  What is the balance in Accounts receivable? A) $104,260 B) $107,460 C) $105,860 D) $110,660 12) Assets are listed on the balance sheet in order of liquidity.  Which.
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11) Under the direct write-off method, a customer who doesn't pay their bills is written off with what journal entry? A) Debit Accounts receivable and credit Uncollectible account expense. B) Debit Uncollectible account expense and credit Cash. C) Debit Uncollectible account expense and credit Accounts receivable. D) Debit Lost revenue and credit Accounts receivable. 12).
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Learning Objective 7-8 1) Before signing a check, the controller or the treasurer should examine the purchase order, the invoice, and the receiving report to determine that the company received the goods and that the company is paying only for the goods received. 2) A receiving report should be matched with.
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11) A certain contingent liability was evaluated at year-end, and considered to have a reasonable possibility of becoming an actual liability.  If the accountant decided NOT to report it on the balance sheet or in the notes to the financial statement, this could be considered unethical behavior. 12) A certain contingent.
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Learning Objective 8-1 1) The two major types of receivables are accounts receivable and notes receivable. 2) The creditor is the entity that signs a note. 3) The two major types of receivables are interest receivable and taxes receivable. 4) Notes receivable are usually longer in term than accounts receivable. 5) Which of the.
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11) Which of the following items should be depreciated? A) Tangible property, plant, and equipment other than land B) Intangible property C) Land D) Natural resources 12) Which of the following items should NOT be depreciated, depleted, or amortized? A) Natural resources B) Land C) Tangible property, plant, and equipment other than land D) Intangible property 13) Which of the.
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21) The decline in value of a copyright is accounted for by: A) depreciation. B) amortization. C) depletion. D) deterioration. 22) Which of the following assets is NOT an intangible asset? A) Patent B) Goodwill C) Building D) Trademark 23) The type of intangible asset related to the rights to original music and media is a: A) goodwill. B) trademark. C) copyright. D) patent. 24).
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11) Which of the following asset categories would include fencing? A) Machinery and equipment B) Land improvements C) Buildings D) Land 12) Which of the following asset categories would include the cost of clearing land and removing unwanted buildings? A) Land B) Buildings C) Land improvements D) Machinery and equipment 13) Which of the following is NOT a characteristic of.
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Learning Objective 7-7 1) A point-of-sale terminal (cash register) provides control over cash in the form of a tape record of sales which is compared to the count of the drawer. 2) As part of the internal control over cash receipts by mail, the mailroom sends both the customer checks and.
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11) The Allowance for uncollectible accounts currently has a debit balance of $200.  The company's management estimates that 2.5% of net credit sales will be uncollectible.  Net credit sales are $115,000. What will be the amount of Uncollectible accounts expense reported on the income statement? A) $2,675 B) $2,875 C) $3,275 D) $3,075 12) The.
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Learning Objective 9-2 1) Estimated residual value is the expected cash value of an asset at the end of its useful life. 2) The straight-line method of depreciation assigns a fixed amount of depreciation to each unit of output produced by an asset. 3) Accelerated depreciation differs from straight-line depreciation in that.
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Learning Objective 8-4 1) A credit card processing company generally uses one of two methods of payment—the net and the gross method. 2) When a business accepts credit cards from customers in payment of sales, the business has to pay a fee to the credit card processor. 3) Which of the following.
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41) Please refer to the following information needed to reconcile the cash balance for Woods Paper Products. •A deposit of $5,794.62 is in transit. •Outstanding checks total $1,533.25. •The book balance is $5,695.62. •The bookkeeper recorded a $1,524.00 check as $15,240 in payment of the current month's rent. •The bank balance at February 28, 2008.
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Learning Objective 9-4 1) Depletion expense is the portion of a natural resource's cost used up in a particular period. 2) Accumulated depletion is a contra asset account. 3) Depletion is the word we use instead of depreciation to attach to recovering the cost of natural resources. 4) Which of the following items.
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Learning Objective 8-6 1) The acid-test ratio appears in the current assets section of the balance sheet. 2) Accounts receivable amounts are generally shown on the balance sheet net of the allowance. 3) The acid-test ratio is computed as current assets divided by current liabilities. 4) Days' sales in receivables is the ratio.
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Learning Objective 7-10 1) A company makes a legitimate, properly authorized payment to a supplier.  The accountant changes the date of the transaction to shift it to a later time period.  Because the transaction is legitimate, this action would not be considered unethical. 2) A company urgently needs to repair its.
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21) Roberts Construction Company paid $40,000 for equipment with a market value of $45,000.  At which of the following amounts should the equipment be recorded? A) $45,000 B) $40,000 C) $42,500 D) $5,000 22) A company purchased a used machine for $80,000.  The machine required installation costs of $8,000 and insurance while in transit of.
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49) Please refer to the following bank reconciliation: Please prepare the adjusting entry for the third reconciling item (NSF check.) 50) Please refer to the following bank reconciliation: Please prepare the adjusting entry for the fourth reconciling item (bank service charge.) 51) Please refer to the following information needed to reconcile the cash balance.
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41) Avery Sales purchased telecom equipment for $12,000 on October 1, 2013.  It has estimated residual value of $1,800, and an estimated life of 8 years.  If Avery uses double-declining-balance depreciation, how much expense will be recorded in 2013? A) $312 B) $375 C) $250 D) $750 42) Charterhouse Services purchased a van on January.
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Learning Objective 8-2 1) The allowance method is a method of recording collection losses by estimating uncollectible amounts. 2) The income statement approach computes uncollectible accounts expense as a percentage of net credit sales. 3) The income statement approach computes uncollectible accounts expense by analyzing accounts receivable. 4) The aging-of-accounts-receivable method computes uncollectible.
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